Prime Minister Kevin Rudd says the security situation in Afghanistan is "grim" and Australians need to prepare themselves for more casualties in a "difficult, dangerous and bloody" year ahead.

Mr Rudd was speaking in Canberra after an Australian special forces commando was killed and four of his comrades were wounded in a firefight with Taliban militants near their base in the southern Uruzgan province.

Twenty-seven-year-old Special Operations Task Group (SOTG) member Lance Corporal Jason Marks was killed early this morning during an attack on a "substantial number" of Taliban militants around 25 kilometres south of the Australian base at Tarin Kowt.